The latest rounds of strikes between the United States and Iran underscore that the instability engulfing the Middle East since the Iran-backed foreign terrorist organization Hamas attacked Israel in October 2023 is far from over. The Gulf monarchies can no longer compartmentalize the Iranian threat. Tehran has activated its network of proxies across multiple fronts—from Gaza and Lebanon to Iraq, Yemen, and the Red Sea—while Israel and the United States have sought to degrade Iran’s nuclear program, military capabilities, and governing apparatus.
The hydrocarbon-exporting economies of the Gulf Cooperation Council (GCC) have been particularly affected since the second phase of the Iran conflict began in February. Iran has retaliated by targeting U.S. military bases in the Gulf, along with energy and civilian infrastructure. Equally significant, the unresolved status of the Strait of Hormuz has emerged as the central strategic vulnerability for Gulf energy exporters and has become the immediate focal point of the conflict. This is especially true for Qatar, the world’s second-largest liquefied natural gas (LNG) exporter, which lacks a meaningful alternative export route. The reliability of Gulf oil and gas exports will hinge on unimpeded transit via the Strait of Hormuz, as well as the end of attacks on energy infrastructure.
This paper examines the short- and long-term implications of the fragile U.S.-Iran memorandum of understanding (MOU) for Gulf LNG flows. It focuses on the evolving status of the Strait of Hormuz, shifting regional power dynamics, and the implications for major exporters such as Qatar.
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